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Global influences
Published in Scott Ambrose, Blaise Waguespack, Fundamentals of Airline Marketing, 2021
Scott Ambrose, Blaise Waguespack
The bilateral framework is the mechanism by which air service between countries (i.e., nation states) is structured. A bilateral is an agreement between two countries on what airline services will be allowed by the countries. When first formulated many bilaterals were, and still can be, very controlling with respect to air-service activities (Rhoades, 2014). Factors that could be specifically spelled out in the bilaterals included designation (which airlines will fly a route), frequency (how many times during a given period a flight may be allowed), port of entry (what airport is to be used to provide international air service), and fares (what prices can be charged). Over time the US, when and where possible, has moved to an “Open Skies” framework dropping many of these strict controls and allowing free-market access, although ownership limits remain. A practice called cabotage— the carrying of passengers within a country by a foreign airline—is not allowed in the US or in most countries across the world due to ownership restrictions. Additionally, with the formulation of the EU, individual bilaterals with each EU member were eventually dropped and the creation of the “multilateral” came into being. EU aviation authorities in Brussels now negotiate air-service agreements across the EU member states.
Vessel logistics and shipping operations management
Published in Dong-Ping Song, Container Logistics and Maritime Transport, 2021
Shipping is the least regulated transport mode due to its international nature. To take advantage of the differences in national tax regulations, operational policies, and financial incentives, the control structure of a single vessel may involve multiple companies that are registered in different countries. For example, maritime cabotage is defined as the sea transport of goods between two seaports located in the same country. More than two-thirds of maritime nations around the world have cabotage laws to restrict foreign maritime operations in their domestic coastal trades. Multiple-company ownership may circumvent the cabotage laws. The complicated control structure of a ship can hide the identity of the real owner so that the liability (for shipping accidents and damage) and taxes (for import goods) could be minimised. Numerous legal entities from different countries are usually involved in maritime transport, e.g. the owner, operator, charterer, shipbroker, the flag of registration, shipyards, port authority, terminal operator, classification society, surveyors, freight forwarder, logistics agent, and an insurance company.
International Aviation
Published in John G. Wensveen, Air Transportation, 2018
An alternative approach is to continue to negotiate bilateral agreements and to permit carriers to expand their route networks through the use of code-sharing agreements with other carriers. Such code sharings are most commonly used for connecting service and permit carriers to market interline transportation as though it were on-line. Although multilateral agreements may ultimately be negotiated, the United States is pursuing the development of global networks bilaterally. A carrier can offer a code-sharing service only in markets where it has the underlying authority, and so the United States is attempting to negotiate open-sky agreements that give both U.S. and non-U.S. carriers broad operating authority. The United States, however, still prohibits cabotage and limits foreign ownership of U.S. carriers; both restrictions are legislated and can only be changed by an act of Congress.
The reasons and the policy instruments behind cabotage policies
Published in Maritime Policy & Management, 2021
Ana Cristina Paixão Casaca, Dimitrios V. Lyridis
Controlled protectionist cabotage policies have been adopted by South Korea, Myanmar, Thailand, Vietnam, Taiwan, Canada, and Mexico. While restricting cabotage industry to local companies and vessels registered under their national flags, controlled protectionist cabotage policies allow the foreign vessels participation in cabotage trades whenever duly justified. Within this context, the Panamanian cabotage case is also interesting. After having for many years a liberalised cabotage market, Panama introduced, in 2013, a protectionist cabotage law mainly to control the market and employment practices. However, the control of cabotage companies appears not to change hands; Berrocal and Rojas (2013) estimated that foreigners would still own 80% of cabotage shipping companies.